As Quant Prosecuted for Stealing Source Code of Headlands Press Opposed Closure So This

As Quant Prosecuted for Stealing Source Code of Headlands Press Opposed Closure So This by Matthew Russell Lee, Patreon Book Substack SDNY COURTHOUSE, Sept 2 –  Back in January 2025 SDNY prosecutors announced an Indictment charging CHEUK FUNG RICHARD HO with theft and attempted theft of trade secrets.  The charges in the Indictment arose from HO’s alleged scheme to steal trade secrets from his former employer, a global quantitative trading firm. That firm was Headlands Technologies LLC. On September 12, 2025 Ho was before U.S. District Court for the Southern District of New York Judge Jannette A. Vargas. Inner City Press was there, and live tweeted: Judge: Where are we on discovery?  AUSA: We've seized the AWS files of Mr. Ho's firm, 15 TB.  Judge: Can you do AI search?  AUSA: We don't currently have that capability. But we think a June 2026 trial is doable Ho's Skadden lawyer: My client says he wrote the source code. All we have from the Government is 61 snippets  Judge: A 3 week trial is set is set to start July 13, 2026. On November 7, 2025 the US Attorney's Office filed to quash subpoenas Ho filed, saying they do not meet the Nixon standard. Jump cut to August 2026, when the US Attorney's Office proposed to seal the courtroom not only for portions of the trial, but also for the Daubert expert hearings. Inner City Press immediately filed opposition, now on CourtListener here. Note that previous attempts in SDNY to seal the courtroom have been opposed, and transparency safeguards imposed were only belated and partially complied with, see here. And here. This is an ongoing project, including in other Districts. On August 18 Ho's lawyers also opposed sealing, and first noted: "A member of the Press has likewise formally opposed the Government's motion to close the courtroom under the First Amendment, see Docket No. 152" - Inner City Press' opposition to unsealing.  Full 16 page memo by Ho's lawyers on Patreon here. On August 21 a non-party was directed to file a declaration supporting sealing - under seal: "ORDER as to Cheuk Fung Richard Ho: Pursuant to 18 U.S.C. § 1835(b), Nonparty-1 is authorized to file under seal a declaration in support of the Government's motion to close the courtroom for portions of the upcoming Daubert hearings and trial.  (Signed by Judge Jeannette A. Vargas on 8/21/2026) ." On August 25 Judge Vargas denied Ho's motion for a bill of particulars, saying in part that the indictment is detailed enough. On August 31 Judge Vargas denied a request to change the timing and sequence of the Daubert hearing. But will it, as the US Attorney's Office has requested, be sealed? An answer came on September 1, just after Inner City Press orally opposed sealing of Judge Vargas' courtroom in another case, Cumulus v. Nielsen) - "received an objection to the contemplated court closure from a member of the press. ECF No. 152 ('Lee Opp’n' or 'Press Opposition'). [T]he Court will authorize limited closure of the courtroom during the Daubert hearings and trial, as set forth further herein. ... The breadth of the closure will be as narrowly tailored as reasonably possible under the circumstances." And so on September 2: All rise! Judge Vargas: My order came out yesterday, on closure. My understanding is that closure will be limited, it covers this hearing [and the trial, which Inner City Press also intends to live tweet]. Please refer obliquely to confidential information  AUSA: We ask for permission at the outset to seal these code files. Ho's lawyer: No objection. Judge: The Government may proceed. AUSA: Ms. Lena Lowenstine, what is your education? Expert: Mathematics, cryptologic, U of Cincinnati.  Expert: I worked at the NSA for over four years, in reverse engineering software... Then at Washington University in St. Louis, I wrote code that automated my own job so I left, to government contractor Booz Allen  Expert: At Booz Allen I reviews satellite imagery. Then I was a contractor for the FBI on cyber investigations.  Now I work directly for the FBI. I am a certified ethical hacker. I have spend 30,000 hours writing computer code.  AUSA: What about this case? DOJ expert: I was shown Headlands files by an AUSA. The files were chosen by Headlands. I compared them to One R Squared's files. AUSA: How did you compare them? DOJ expert: Keywords, the names used, specific elements  AUSA: What was the level of similarity between the Headlands code and the One R Squared code? DOJ expert: It's like two textbooks with the same chapters, same sections and the sentences are saying the same thing, it's one to one. AUSA: Our private screens don't seem to work. Can we ask the people in the gallery to sit in the jury box so they can't see? [Press question: how would this work in the trial, which they also want to partially seal and use privacy screen - but there will be jurors  DOJ expert: Both softwares, representing one third, used 15 threes before stopping. The choices the developer made were exactly the same. 32 times. AUSA: What do you conclude? DOJ expert: That the One R Squared code was derived from Headlands, not independent Cross Ho's lawyer: Do you have any education about trading in the financial markets? DOJ expert Lowenstine: No. Ho's lawyer: But you did crypto logic math. What is that - figuring out somebody's password? Lowenstein: Not really. It's about a key  Ho's lawyer David Meister: At the NSA, your work had nothing to do with HFT? DOJ expert Lowenstein: I don't know what that is.  [Inner City Press: It is high frequency trading. Some questions about witness prep here : ) More on X, Threads, Bluesky.  Watch this site. The case is USA v. Ho, 1:25-cr-3 (Vargas) *** Your support means a lot. As little as $5 a month helps keep us going and grants you access to exclusive bonus material on our Patreon page. Click here to become a patron. Feedback: Editorial [at] innercitypress.com Mail: Box 130222, Chinatown Station, NY NY 10013 Other, earlier Inner City Press are listed here, and some are available in the ProQuest service, and now on Lexis-Nexis.  Copyright 2006-2026 Inner City Press, Inc. To request reprint or other permission, e-contact Editorial [at] innercitypress.com